Looking ahead to retirement can help you figure out whether you have saved enough to support your lifestyle and how you intend to pass on some of your assets to others.
The typical worker in the United States retires at age 63, but a growing portion of this population is waiting to retire until later in order to enhance their savings. It turns out that there is not perfect retirement age, but you may be able to identify the various milestones linked to traditional retirement in the United States that can help you figure out what might be most appropriate for you.
You might decide to delay tapping into Social Security benefits since you can increase the amount you receive by going this route. If you delay taking Social Security beyond your full retirement age, your benefits go up. For example, full retirement age is 66 and you If you opt in at age:
- 66, you’ll receive 100% of your monthly benefits
- 67, you’ll get 108% of your monthly benefits
- 70, you’ll receive 132% of your monthly benefits
Social Security Chart: https://www.ssa.gov/planners/retire/1943-delay.html
Some of the most important milestone ages nearing retirement include:
Age 59 ½ is the first time you are eligible to take penalty free withdrawals from your IRA or 401(k).
Age 62 is when you can start claiming social security.
Age 65 is when you initially become eligible for Medicare.
Age 66 is the full retirement age for those individuals born between 1943 and 1954.
Age 67 is your social security full retirement age, if you were born in 1960 or later.
Age 70 is when you stop accruing delayed retirement credits for waiting to enroll in social security.
Age 70 1/2 is when it is necessary to start taking required minimum distributions or RMDs from your traditional 401(k) or IRA.
There are some additional questions that you can ask yourself to help to determine whether or not it is time for you to retire. These include;
- How is your health in general?
- Are you still working and how is your job?
- How do you plan to fill your dates?
Consulting with an experienced estate planning attorney in Massachusetts is another step that is necessary to take as you get closure to the retirement process.